Outsmarting Dropshipping: Harnessing CEX’s Pre-Owned Market for Profitable eBid Sales in the UK

UK sellers are discovering a lucrative niche: selling pre-owned items sourced locally from shops like CEX, particularly on platforms like eBid. This approach not only opens the door to a treasure trove of unique, in-demand items but also allows sellers to sidestep the common pitfalls of traditional dropshipping.

Setting the right price is more than just about covering costs; it’s about understanding every fee that impacts your bottom line and ensuring you’re left with a profit worth your effort. For those considering or already venturing into selling on platforms like eBid, this detailed guide is your roadmap to pricing your items smartly, ensuring you maintain a minimum profit margin after all costs. We’ll dissect every part of the pricing process with actual examples and shed light on why this method might edge over traditional dropshipping.

1. Understanding Your Costs and Profits on eBid

When selling on eBid, you’re dealing with various costs that chip away at your profits. These include the cost of your product, delivery fees (if applicable), postage, eBid’s listing fees, transaction fees, and eBid’s final value fee. By the end of this guide, you’ll know exactly how to calculate your final selling price to ensure you hit your desired profit margin.

Example 1: Selling a Video Game from CEX.co.uk

Let’s say you’re selling a video game that you bought for £3.00, and you’re using eBid’s services to reach your customers.

• Cost of the Game: £3.00
• CEX Delivery Fee (if not collected in-store): £2.50
• UK Second Class Recorded Postage: £2.90
• eBid Listing Fee (Platinum with add-ons): £0.36
• PayPal Transaction Fee: 3.4% of the total cost + £0.20

Calculating your costs:

• Total Cost Before eBid Final Value Fee: £3.00 + £2.50 + £2.90 + £0.36 = £8.76
• PayPal Fee: (3.4% of £8.76) + £0.20 = £0.50
• Total Cost Including Transaction Fee: £8.76 + £0.50 = £9.26

Now, to ensure a minimum of 5% profit:

• Desired Selling Price Before eBid Final Value Fee: £9.26 / (1 – 0.05) = £9.75

But, eBid takes a final value fee of 5% of your selling price:

• eBid Final Value Fee: 5% of £9.75 = £0.49
• Final Selling Price Including All Fees: £9.75 + £0.49 = £10.24

So, to maintain a 5% profit margin, you should list your video game for £10.24.

Example 2: Selling a 500GB Hard Drive

Now, let’s consider a 500GB Hard Drive you acquired for £6.00:

• Cost of the Hard Drive: £6.00
• UK Second Class Recorded Postage: £2.90
• eBid Listing Fee (Platinum with add-ons): £0.36
• PayPal Transaction Fee: 3.4% of the total cost + £0.20

Let’s do the math:

• Total Cost Before eBid Final Value Fee: £6.00 + £2.90 + £0.36 = £9.26
• PayPal Fee: (3.4% of £9.26) + £0.20 = £0.51
• Total Cost Including Transaction Fee: £9.26 + £0.51 = £9.77

For a 5% profit margin:

• Desired Selling Price Before eBid Final Value Fee: £9.77 / (1 – 0.05) = £10.28
• eBid Final Value Fee: 5% of £10.28 = £0.51
• Final Selling Price Including All Fees: £10.28 + £0.51 = £10.79

To ensure a 5% profit margin, list your 500GB Hard Drive for £10.79.

Example 3: Selling a Graphics Card (International Sales)

For international sales, let’s take a Graphics Card purchased for £12.00, aiming for a 25% profit margin:

• Cost of the Graphics Card: £12.00
• Royal Mail International Signed For: £15.00
• eBid Listing Fee (Platinum with add-ons): £0.36
• PayPal Transaction Fee: 3.4% of the total cost + £0.20

Calculations:

• Total Cost Before eBid Final Value Fee: £12.00 + £15.00 + £0.36 = £27.36
• PayPal Fee: (3.4% of £27.36) + £0.20 = £1.15
• Total Cost Including Transaction Fee: £27.36 + £1.15 = £28.51

For a 25% profit margin:

• Desired Selling Price Before eBid Final Value Fee: £28.51 / (1 – 0.25) = £38.01
• eBid Final Value Fee: 5% of £38.01 = £1.90
• Final Selling Price Including All Fees: £38.01 + £1.90 = £39.91

To maintain a 25% profit margin on international sales, you should list your Graphics Card for £39.91.

2. The Advantage Over Traditional Dropshipping

Choosing to sell on platforms like eBid, especially when you’re handling the items yourself or through a source like CEX.co.uk, can offer advantages over traditional dropshipping.

• Control Over Inventory and Shipping: You’re not at the mercy of third-party suppliers’ stock levels or shipping times, which can often lead to customer service issues.
• Higher Profit Margins: By carefully calculating your costs and setting your prices, as shown above, you can maintain a healthy profit margin.
• Brand Building: You have more opportunities to brand your packaging and provide a personalized customer experience, which is often lacking in traditional dropshipping.

While this approach requires a bit more upfront investment and involvement, the control and potential for higher profit margins can make it a worthwhile endeavor for many sellers.

Setting the right price on eBid involves understanding every fee and strategically calculating your selling price to ensure profitability. Whether you’re selling domestically or internationally, it’s crucial to account for every cost, including product cost, delivery fees, postage, transaction fees, and eBid’s fees. By meticulously calculating your selling price and understanding the advantages of this approach over traditional dropshipping, you’re setting yourself up for success in the competitive world of online selling.